RMDs

Updates

January 12, 2023: regional bank provides update. 

August 9, 2022: changing age to age 75 years old?

August 9, 2022: the "new" rules, still up in the air --

• Forbes: not yet finalized, but likely they will be;
• gobankingrates: "horribly complex"
• Yahoo!Finance: a real mess;

April 4, 2022: Investopedia -- the rules now.

December 14, 2021: Forbes -- the rules now.

March 30, 2021: tea leaves suggest the "72" age will be increased to 75. The only question is whether Congress will get it done this year or next. This year is mid-term elections; now or never.

RMDs

Original Post: April 7, 2019

Baby boomers. Richest generation in US history.

Greatest generation: the parents of the boomers. The greatest generation: the first generation to leave money to their children, the boomers.

The baby boomers: 1946 - 1964.

I was born very, very early in the boomer generation.

I will start taking RMDs from IRAs soon -- not this year, not next year, but soon. Once we start taking RMDs, we will take RMDs for 26 years. And I'm at the beginning of that bow wave of those taking RMDs; I was among the early boomers.

I will most likely re-invest those RMDs.

But Uncle Sam will start to collect taxes on those RMDs.

We don't hear much talk about that, but my hunch is that by the time the peak of that bow wave hits, let's say ten years from now, the amount of money Uncle Sam collects from taxes on RMDs will not be trivial.

I thought about that (RMDs) when I read the Barron's headline and part of the story: the bull market could last another decade. 

World's Best Surfing, 2017

NASCAR Wheel Changer -- How Hard Can It Be? March 30, 2022

You had one job. 

Bubba Wallace's NASCAR  crew suspended four races for loose wheel. 

Yes, I saw that live. There is one ... one, count them -- lug nut -- just one lug nut on a NASCAR wheel -- and one was not tightened, resulting in a wheel coming off Bubba Wallace's car last weekend, another DNF for the driver. 

Well, I suppose three out of four ain't bad. 

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Biggest Story At The "Oscars"

Well, it would have been Apple. Financial Times, paywall.

But not to be. 

Top story stolen by "the slap."

Regardless, it's a huge story:

After a movie year often light on crowds, the Academy Awards named an unabashed crowd-pleaser, the deaf family drama “CODA,” best picture Sunday, handing Hollywood’s top award to a streaming service for the first time in a ceremony that saw the greatest drama when Will Smith strode onstage and slapped assaulted Chris Rock.

Sian Heder’s “CODA,” which first premiered at a virtual Sundance Film Festival in winter 2021, started out as an underdog but gradually emerged as the Oscars’ feel-good favorite. It also had one very deep-pocketed backer in Apple TV+, which scored its first best picture Academy Award on Sunday, less than three years after launching the service.

It also handed another near-miss defeat to Netflix, the veteran streamer that for years has tried vainly to score best picture. Its best chance, Jane Campion’s “The Power of the Dog,” came in with a leading 12 nominations. It won one, for Campion's direction.

Netflix has been around for decades: no "best picture Oscar."

Apple TV+: two, maybe three years: first "best picture Oscar."

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The Movie Page

It is absolutely amazing how much content for so little money is now available. It blows me away.

Basic cable, no bundling. Hulu. Amazon Prime. Firestick. Apple TV+. And I guess we get some Disney with the Hulu subscription. 

My evening pretty much runs like this:

• 4:00 p.m. - 7:00 p.m.: with Sophia -- flashcards, Duolingo, biking, reading, some writing (journal), Legos, piano, Bat Cave, hoverboard, maybe an episode of Psyche with Sophia;
  
• 7:00 p.m. - 10:00 p.m. Perry Mason re-runs
• 10:00 p.m. -- 1:00 a.m. Movie night, every night -- last night, Midnight in Paris

Obviously the movies are in the background, while I'm blogging and/or reading.

Now today, over at Literary Hub, Beth Parker's 14-month-long communion with Robert Ebert. Takes two minutes to read and provides some nice movie suggestions. 

Another suggestion, just found it last night: Ramen Heads, Osamu Tomita -- ranked #1 ramen in Japan three years running. First question, how does one even top the list one time in all of Japan, not to mention three years running. This is my third "ramen movie." The Clint Eastwood spaghetti western ramen movie is still the best. I'm not sure where it streams; I wasn't on Hulu but easily found it again this morning, but forgot to note "network." Whatever. IMDB.

Can't remember where "unconditional love" showed up in one of the movies. I misheard "unconditional" and thought I heard something else. Unrequited love, unconditional love, uncompleted love, unknown love, unbelievable love, unquestionable love, unlikely love, unending love. Most interesting: uncompleted love.

Weekly EIA Petroleum Report -- March 30, 2022

Link here.

• US crude oil in storage decreased by a modest 3.4 million bbls last week.
• US crude oil in storage now stands at 409.9 million bbls, 14% below the five-year average and at least twice that amount needed in current environment based on days of supply in storage;
• US crude oil imports averaged 6.3 million bopd (yawn), down by 227,000 bopd from the previous week;
• US crude oil imports averaged 6.4 million bopd, 11.9% more than the same four-week period last year;
• US refiners are stepping up their game; now operating at 92.1% of their operable capacity
• distillate fuel inventories increased by 1.4 million bbls last week; still 16% below the five year average
• jet fuel supplied up was up 39.1% compared to same four-week period last year.

Finance -- Economy -- Rambling -- March 30, 2022

Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here. 

Jobs:

• private payrolls rose by almost half a million; topped expectations --- yeah, that was the headline; LOL:
• estimate: 450,000 jobs
• actual: 455,000 jobs
• so, yes, headline technically correct; but more accurate, "in line"
• giving the Biden administration a little extra help with this headline
• perhaps this should be the headline:
• job growth in the U.S. private sector has decelerated in every month since December, when nearly 800,000 payrolls returned in a single month

GDP, 2021: story here.

• for all of 2021, the nation’s gross domestic product — its total output of goods and services — jumped by 5.7%, the fastest calendar-year growth since a 7.2% surge in 1984 in the aftermath of a brutal recession.
• previous estimate was a 7% jump
• the writer downplays it, but a drop from 7% to 5.7% is not trivial
• a 23% downgrade, as it were
• the "small" downgrade (23%) reflected a smaller increase in consumer spending and fewer exports, both of which could worse going forward
• this strengthens the argument for those who see stagflation around the corner
• but look at that: strongest calendar-year growth since 1984 when US coming out of a brutal recession
  
• having said that, the post-Covid surge has not yet begun

EU energy crisis: Germany warns of natural gas rationing

Proxies: developing a list of one ticker for each sector as a proxy of overall trend

• Big Oil: CVX
• shale: DVN
• rail: UNP
• auto/EV: F
• semiconductor: up for grabs; perhaps AMD by default;
  
• chip foundry: TSM
• graphic cards: NVDA
• midstream: SRE
• value: BRK-B
• wow factor: AAPL

Old people and Covid: okay to get additional booster. Starting to lose count, but those that need to know, know

More later: taking Olivia to school

Two Wells Coming Off Confidential List; What's Oil Doing? March 30, 2022

Watch this space: RMDs.

Essay: if you have time for just one essay today, read today's "Ross Rant" sent to me by a reader;

• pretty much something for everyone
• I think "Ross" was too "negative" on Biden; not "hard enough" on the EU
• I think he forgets that "no one" pays attention to Biden, except for the gaffes
• the gaffes telegraph what Biden is really thinking 
• as far as giving away classified information, the Russians already know
  
• humanitarian crisis already in Poland, next Germany; Macron watching

Bill Ackman:

• has annualized 17%, net of fees, over the last eighteen years - source;

Ukraine:

• food basket to much of Europe
• half of the food for the World Food Program comes from Ukraine
• 2022-2023: Ukraine will become a net importer of grain - source;

Sanctions starting to bite:

• first real signs of well-head production declines are starting to be seen; source;
  
• one-two punch:
• some countries will quit buying from Russia; others will take up some of that slack
• production in Russia: relies on foreign expertise, equipment: that's a much bigger obstacle
• analogy: US supply chain issues the past 24 months
• now Russia: the supply chain issues writ large
• we will soon see that Russia relies on rest of world much more than world relies on Russia
• unsold oil forces Russian operator to cap pipeline flows; source;  
• fields will start to cut back on production
• risk of losing shut-in wells;
  

Oil, data points:

• OPEC+ now forecasts 600,000 bopd surplus 1Q22; previously, one million
• first 27 days of March: OPEC crude oil exports fell on average 363,000 bopd; averaged 21.421 million bopd
• Saudi looking to raise May crude prices to Asia to new record levels;
• if so, OPEC basket record: $110 going back to 2012; OPEC Basket;
• this speaks volumes about all those stories about all that cheap Russian oil getting to China, India;
• my hunch: Saudi knows all about Russia's need for foreign investment to keep oil flowing
• proxy for US shale: DVN
• up 6 cents yesterday
• up 72 cents in pre-market trading today
  

Oil:

• Brent: up 2.8%; up $3.12; trading pre-market at $113.30;
• WTI: up 3.1%; up $3.23; trading pre-markeet at $107.50
• Note: what's "oil doing?"

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Back to the Bakken

Active rigs: 

$106.90	3/30/2022	03/30/2021	03/30/2020	03/30/2019	03/30/2018
Active Rigs	34	14	44	66	60

Thursday, March 31, 2022: 47 for the month, 156 for the quarter, 159 for the year

• None.

Wednesday, March 30, 2022: 50 for the month, 159 for the quarter, 159 for the year

• 38547, conf, Ovintiv, Wisness State 152-96-16-21-21H, Westberg, no production data,
• 38293, conf, CLR, Springfield 11-8HSL, Brooklyn, no production data,

Tuesday, March 29, 2022: 48 for the month, 157 for the quarter, 157 for the year

• 37860, conf-->loc/drl, CLR, Clear Creek Federal 10-35H2, Westberg, no production data,

RBN Energy: crude oil prices, drilling activity and the new energy-world order. 

Just a few years ago, when the Shale Revolution had matured into the Shale Era, the world settled into a nice groove, with crude prices generally rangebound between $40 and $70/bbl. As the U.S. looked to assume OPEC+’s role and evolve into the world’s swing supplier of oil, ramping up production when prices rose and slowing it down when they fell, it seemed reasonable to expect that market-driven responses would help maintain stability. Well, things haven’t turned out that way. 

COVID, the emphasis on ESG, a hydrocarbon-averse administration, and Russia’s war on Ukraine combined to put “reasonable expectations” in the trash. An entirely new set of expectations is emerging, and few metrics explain it better than today’s different-as-can-be relationship between crude oil prices and the U.S. rig count, as we discuss in today’s RBN blog.